Royal Bank of Canada (NYSE:RY – Get Rating) and Hang Seng Bank (OTCMKTS:HSNGY – Get Rating) are both large-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, risk, earnings, valuation and analyst recommendations.
This table compares Royal Bank of Canada and Hang Seng Bank’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Royal Bank of Canada||28.16%||18.28%||0.98%|
|Hang Seng Bank||N/A||N/A||N/A|
Royal Bank of Canada pays an annual dividend of $3.80 per share and has a dividend yield of 3.5%. Hang Seng Bank pays an annual dividend of $0.84 per share and has a dividend yield of 4.4%. Royal Bank of Canada pays out 42.3% of its earnings in the form of a dividend.
Volatility and Risk
Royal Bank of Canada has a beta of 0.91, meaning that its stock price is 9% less volatile than the S&P 500. Comparatively, Hang Seng Bank has a beta of 0.52, meaning that its stock price is 48% less volatile than the S&P 500.
This is a summary of recent recommendations for Royal Bank of Canada and Hang Seng Bank, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Royal Bank of Canada||1||4||8||0||2.54|
|Hang Seng Bank||0||1||0||0||2.00|
Royal Bank of Canada presently has a consensus price target of $144.81, indicating a potential upside of 33.46%. Given Royal Bank of Canada’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Royal Bank of Canada is more favorable than Hang Seng Bank.
Insider & Institutional Ownership
41.0% of Royal Bank of Canada shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Earnings and Valuation
This table compares Royal Bank of Canada and Hang Seng Bank’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Royal Bank of Canada||$45.99 billion||3.34||$12.76 billion||$8.99||12.07|
|Hang Seng Bank||$10.04 billion||3.64||$1.80 billion||N/A||N/A|
Royal Bank of Canada has higher revenue and earnings than Hang Seng Bank.
Royal Bank of Canada beats Hang Seng Bank on 10 of the 13 factors compared between the two stocks.
About Royal Bank of Canada (Get Rating)
Royal Bank of Canada operates as a diversified financial service company worldwide. The company's Personal & Commercial Banking segment offers checking and savings accounts, home equity financing, personal lending, private banking, indirect lending, including auto financing, mutual funds and self-directed brokerage accounts, guaranteed investment certificates, credit cards, and payment products and solutions; and lending, leasing, deposit, investment, foreign exchange, cash management, auto dealer financing, trade products, and services to small and medium-sized commercial businesses. This segment offers financial products and services through branches, automated teller machines, and mobile sales network. Its Wealth Management segment provides a suite of advice-based solutions and strategies to high net worth and ultra-high net worth individuals, and institutional clients. The company's Insurance segment offers life, health, home, auto, travel, wealth, annuities, and reinsurance advice and solutions; and business insurance services to individual, business, and group clients through its advice centers, RBC insurance stores, and mobile advisors; digital, mobile, and social platforms; independent brokers; and travel partners. Its Investor & Treasury Services segment provides asset servicing, custody, payments, and treasury services to financial and other investors; and fund and investment administration, shareholder, private capital, performance measurement and compliance monitoring, distribution, transaction banking, cash and liquidity management, foreign exchange, and global securities finance services. The company's Capital Markets segment offers corporate and investment banking, as well as equity and debt origination, distribution, advisory services, sale, and trading services for corporations, institutional investors, asset managers, private equity firms, and governments. The company was founded in 1864 and is headquartered in Toronto, Canada.
About Hang Seng Bank (Get Rating)
Hang Seng Bank Limited, together with its subsidiaries, provides various banking and related financial services to individual, corporate, commercial, small and medium-sized enterprise, and institutional customers in Hong Kong, Mainland China, and internationally. It operates through four segments: Wealth and Personal Banking, Commercial Banking, Global Banking and Markets, and Other. The company offers personal banking services, including current and savings accounts, time deposits, mortgages and personal loans, credit cards, and insurance and wealth management services, as well as consumer lending services. It also provides corporate lending, trade and receivable finance, payments and cash management, treasury and foreign exchange, general insurance, key-person insurance, investment, and corporate wealth management services, as well as general banking, interest rate, foreign exchange, money market, structured, and derivative products, etc. In addition, the company offers retirement benefit, life assurance, fund management, and stock broking services, as well as index compilation and licensing; fund raising and sales; and asset management services. It operates approximately 290 service outlets in Hong Kong; branches in Macau and Singapore; and a representative office in Taipei. Hang Seng Bank Limited, through its subsidiary, Hang Seng Bank (China) Limited, operates a network of outlets in approximately 20 cities in Mainland China. The company was founded in 1933 and is headquartered in Central, Hong Kong. Hang Seng Bank Limited is a subsidiary of The Hongkong and Shanghai Banking Corporation Limited.
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